How a Lack of Trust Affects the Global Market Capitalisation of the Cryptocurrency Industry

Recently, BlockchainDefender released a report examining the impact of online sentiment on the cryptocurrency industry, including how it affects the industry’s global market capitalisation. The report takes advantage of BlockchainDefender’s experience of analysing online sentiment.

Online Sentiment Affects Market Capitalisation

The first study in the BlockchainDefender report confirms that online sentiment towards cryptocurrency impacts the industry’s market capitalisation. The report illustrates this connection via a graph with different lines for search volume, sentiment and market capitalisation. The three lines all move together, both in terms of increases and decreases. This correlation is most obvious in the rises of late 2017 and the dip from January to March 2018. The last several months of the graph shows all figures stabilising.

Differences in Online Sentiment by Country

The report looks at the online sentiment regarding cryptocurrency in Japan, the USA, Germany and the UAE. Of these, the USA has the most negative sentiment and Japan has the least. The report indicates that most negative online sentiment comes from cryptocurrency industry news websites, social media platforms, blogs, forums, crypto review websites, and crypto company directories and websites.

Online Sentiment for Specific Cryptocurrencies

BlockchainDefender also examines individual cryptocurrencies in the report. Looking at Bitcoin in the same four countries, the most positive results are in the UAE, followed by Germany, the USA, then Japan. The most negative results are in the USA, followed by Germany, the UAE and Japan.

From a global perspective, Iconomi is the cryptocurrency with the most positive online sentiment. Bitcoin Cash sits at the other end of the spectrum with the most negative online sentiment.

The report ends with a look at online sentiment for a specific yet unnamed cryptocurrency that faced a hacking attack and subsequent crisis in 2018. Following the crisis, positive online content decreased while negative online content increased. Interestingly, these changes were more significant in the West than in the East.

Online Sentiment Towards Traditional and Cryptocurrency Exchanges

BlockchainDefender also evaluates online sentiment towards cryptocurrency exchanges with the sentiment towards traditional exchanges that are well-established. The team analysed data in four countries regarding ten of each exchange type. The analysis indicates that Google search results have much more negativity for cryptocurrency exchanges than traditional exchanges.

The report indicates that a key influence in this disparity is the lack of ownership of online sentiment for cryptocurrency exchanges. While traditional exchanges have ownership of 34.88% of their search results, crypto exchanges only own 17.75% of their results. That leads to a reduction in control, which translates to more online negativity.

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